After a costly expansion in Austria, where it has acquired the real estate companies S Immo and Immofinanz, the CPI Property Group is, on the contrary, shrinking and selling, particularly in Germany and Austria, according to seznamzpravy.cz.
After years of an acquisition campaign, CPIPG is now sorting out its portfolio and selling real estate. The reason is the costly takeover of the Austrian companies S Immo and Immofinanz in 2022. The group paid €3.4 billion for both companies, of which €2.7 billion was financed with a bridging loan. However, due to the increase in inflation, borrowing costs also increased, as central banks raised interest rates to dampen price growth. The rise in the price of money was also reflected in lower prices for commercial real estate.
The group would now like to get rid of its debt burden. “The main goal of the divestments is to reduce debt and strengthen the financial stability of the group,” says CPIPG spokesman Jakub Velen, adding that gross debt has already decreased by €1.1 billion since the end of 2023. However, the debt-to-asset ratio is still around 50 per cent.
The real estate group will continue selling properties. By the end of May, CPIPG had closed or signed property sales worth over €650 million. Of this, €230 million represents signed deals that still need to be settled, according to the group's June presentation to investors.
This year, it wants to sell properties for more than €1 billion in total and at least €500 million in the next two years. In total, the group has assets worth more than €3 billion ready for possible sale.
The group will be active in sales mainly abroad. "The sales plan mainly includes office and retail properties in Germany and Austria, which do not correspond to our long-term strategy. It also includes hotels with limited growth potential, land without current income and development projects," says Velen, adding that the goal is "further debt reduction and streamlining of the portfolio structure."
